Royal Gold Reports Record Operating Cash Flow in its Third Quarter 2017

DENVER--(BUSINESS WIRE)--
Royal Gold, Inc. (NASDAQ: RGLD) (together with its subsidiaries,
“Royal Gold” or the “Company,” “we” or “our”) reports net income
attributable to stockholders (“net income”) of $23.7 million, or $0.36
per share, on revenue of $107.0 million in its fiscal third quarter
ended March 31, 2017 (“third quarter”). Earnings increased significantly
compared to the prior year quarter net loss attributable to stockholders
of $67.7 million, or ($1.04) per share, on revenue of $93.5 million.

Third Quarter Highlights as Compared to the Prior Year Quarter:

Record operating cash flow of $76.1 million, an increase of 15%

Revenue of $107.0 million, an increase of 14%

Volume of 87,700 Gold Equivalent Ounces (“GEOs”1), an
increase of 11%

Dividends paid of $15.7 million, an increase of 4%

Average gold price of $1,219, an increase of 3%

“We generated our second straight quarter of record operating cash flow,
and paid down $45 million of debt,” commented Tony Jensen, President and
CEO. “With no additional funding requirements, cash flow from our
diverse stream and royalty portfolio on 38 operating properties will
continue to strengthen our balance sheet. At the same time, we look
forward to three new or expanding sources of revenue currently in
development, including New Gold’s Rainy River mine, Barrick’s Cortez
Crossroads mine, and Goldcorp’s Pyrite Leach Project at the Peñasquito
mine. We expect these new projects to be commissioned in calendar 2017,
2018 and 2019, respectively, providing further growth and revenue
diversification.”

___________

1

GEOs are calculated as revenue divided by the average gold price for
the same period. GEOs net of stream payments were 69,400 in the
third quarter, compared to 63,900 a year ago.

Third Quarter Overview

Third quarter revenue of $107.0 million included stream revenue of $76.6
million and royalty revenue of $30.4 million. Stream segment gold
purchases were approximately 50,000 ounces, while sales totaled
approximately 58,000 ounces. Stream segment silver purchases were
approximately 374,000 ounces and silver sales were approximately 322,000
ounces. The Company had approximately 15,000 gold ounces and 375,000
silver ounces in inventory at March 31, 2017, as previously announced,
compared to approximately 24,000 gold ounces and 323,000 silver ounces
in inventory at December 31, 2016.

Total revenue increased 14% from the prior year quarter. Higher sales
from our Mount Milligan and Pueblo Viejo streams relative to the prior
year quarter more than offset lower sales from our Andacollo stream,
which was due to timing of concentrate shipments.

Third quarter cost of sales was $22.4 million, compared to $17.9 million
in the prior year quarter. The increase was primarily due to higher gold
sales from Mount Milligan and increased gold and silver sales from
Pueblo Viejo. Cost of sales is specific to our stream agreements that
call for Royal Gold’s purchase of gold and silver for a cash payment per
ounce.

General and administrative expenses decreased to $5.4 million in the
third quarter, compared to $7.7 million in the prior year quarter. The
decrease was primarily related to lower non-cash stock-based
compensation charges.

Exploration costs, which are related to our Peak Gold joint venture
(“Peak Gold”) in Alaska, totaled $2.6 million in the third quarter,
compared to $1.9 million in the prior year quarter. As of March 31,
2017, Royal Gold had earned a 24.9% interest in the joint venture. Peak
Gold is currently preparing a resource estimate which is expected to be
complete by the end of the June 2017 quarter.

Interest and other income decreased during the third quarter to $1.3
million from $3.1 million in the prior year quarter. The decrease was
primarily due to a realized gain on the sale of marketable securities
during the prior year quarter and a decrease in the fair value of
certain warrants we own.

We recognized a third quarter income tax expense of $6.5 million,
compared with an income tax benefit of $8.3 million during the prior
year quarter. This resulted in an effective tax rate of 23.2% in the
current period. The prior year effective tax rate of 10.6% reflected
impairment charges recorded a year ago.

At March 31, 2017, we had current assets of $134.2 million compared to
current liabilities of $24.8 million, resulting in working capital of
$109.4 million. This compares to current assets of $164.8 million and
current liabilities of $22.7 million at June 30, 2016, resulting in
working capital of $142.1 million. As of March 31, 2017, the Company had
$350 million available and $300 million outstanding under its revolving
credit facility. In the third quarter, the Company repaid $45.0 million
of the outstanding borrowings under the revolving credit facility.
Working capital, combined with the Company’s undrawn revolving credit
facility, resulted in approximately $459.4 million of total available
liquidity at March 31, 2017.

Recent Developments

Mount Milligan Stream Amendment

We began receiving gold and copper deliveries reflecting the amended
Mount Milligan stream agreement in April 2017. Under the terms of the
amendment, our 52.25% gold stream has been amended to a 35.0% gold
stream and an 18.75% copper stream. We will continue to pay $435 per
ounce of gold delivered and will pay 15.0% of the spot price per metric
tonne of copper delivered. Under the terms of both the original and
amended agreements, there is a maximum of five months between
concentrate shipment and final settlement.

Royal Gold expects that, on the basis of its current stream and royalty
portfolio, approximately 85% of the next several fiscal years’ revenue
will come from precious metals.

Wassa and Prestea Gold Stream Acquisition

On January 3, 2017, the Company made the final scheduled payment of
$10.0 million under the Wassa and Prestea streaming agreement. The
Company has no further upfront payment obligations associated with the
Wassa and Prestea gold stream. Commercial production was achieved at
Wassa Underground on January 1, 2017. Commercial production at Prestea
Underground is currently expected to be achieved in the third calendar
quarter of 2017. Upon the earlier of either commercial production from
Prestea Underground or January 1, 2018, our streaming interest
associated with Golden Star’s Ghanaian assets will increase from 9.25%
to 10.5%.

Attributable Reserves

Royal Gold announces updated estimates of ore reserves and mineralized
material1 attributable to the Company’s stream, royalty and
similar interests as of December 31, 2016. These figures are provided by
the operators of properties on which the Company holds these interests,
or are obtained by Royal Gold through publicly available information.

On a gold equivalent basis2, using a silver to gold ratio of
approximately 70:1 and a copper to gold ratio of 450:1, metals reserves
attributable to Royal Gold were 6.7 million ounces, on a net reserve
basis, compared with 6.8 million ounces for the same period ended 2015.
The complete Royalty/Metal
Stream Portfolio, which includes the ore reserves and mineralized
material1 subject to the Company's interests on producing and
development properties, can be found on our website.

___________

1

The U.S. Securities and Exchange Commission does not recognize this
term. Mineralized material is that part of a mineral system that has
potential economic significance but cannot be included in the proven
and probable ore reserve estimates until further drilling and
metallurgical work is completed, and until other economic and
technical feasibility factors based upon such work have been
resolved. Investors are cautioned not to assume that any part or all
of the mineral deposits in this category will ever be converted into
reserves.

A summary of third quarter and historical production can be found on
Tables 1 and 2. Calendar year 2017 production estimates of the operators
of certain properties in which we have interests versus actual
production at those properties can be found on Table 3. Results of our
streaming business for the third quarter, compared to the prior year
quarter, can be found on Table 4. Highlights at certain of the Company’s
principal producing and development properties during the third quarter,
compared to the prior year quarter, are detailed in our Form 10-Q.

CORPORATE PROFILE

Royal Gold is a precious metals stream and royalty company engaged in
the acquisition and management of precious metal streams, royalties and
similar production based interests. The Company owns interests on 193
properties on six continents, including interests on 38 producing mines
and 22 development stage projects. Royal Gold is publicly traded on the
NASDAQ Global Select Market under the symbol “RGLD.” The Company’s
website is located at www.royalgold.com.

Note: Management’s conference call reviewing the third quarter
results will be held on Thursday, May 11, 2017, at noon Eastern Time
(10:00 a.m. Mountain Time). The call will be webcast and archived on the
Company’s website for a limited time.

Cautionary “Safe Harbor” Statement Under the Private Securities
Litigation Reform Act of 1995: With the exception of historical
matters, the matters discussed in this press release are forward-looking
statements that involve risks and uncertainties that could cause actual
results to differ materially from projections or estimates contained
herein. Such forward-looking statements include statements about cash
flow from operating properties strengthening our balance sheet; Rainy
River, Cortez Crossroads and the Peñasquito Pyrite Leach Project as new
or expanding sources of revenue providing further growth and revenue
diversification, and the expected timing of commissioning of these
projects; operators’ expectations regarding future production and
returns from our stream and royalty properties; timing for receipt of
gold and copper deliveries from Mount Milligan under the amended Mount
Milligan stream agreement; estimated percentages of future net revenue
from precious metals expected from the Company’s stream and royalty
portfolio in the aggregate; operators’ production estimates for calendar
year 2017; reserves and additional mineralization estimates provided by
the operators or obtained by Royal Gold through publicly available
information; the sliding-scale features of our royalty structure at
certain of our properties; and estimates of commencement of production
at projects in development. Net gold and metal reserves attributable to
Royal Gold’s stream, royalty and other interests are subject to certain
assumptions and, like reserves, do not reflect actual ounces that will
be produced. Like any stream, royalty or similar interest on a
non-producing or not-yet-in-development project, our interests on
development projects are subject to certain risks, such as the ability
of the operators to bring the projects into production and operate in
accordance with their feasibility studies, and the ability of Royal Gold
to make accurate assumptions regarding valuation and timing and amount
of payments. In addition, many of our interests are subject to risks
associated with conducting business in a foreign country, including
application of foreign laws to contract and other disputes, foreign
environmental laws and enforcement and uncertain political and economic
environments. Factors that could cause actual results to differ
materially from the projections include, among others, precious metals,
copper and nickel prices; performance of and production at the Company's
stream and royalty properties, including gold and copper production at
Mount Milligan and gold and silver production at Pueblo Viejo; the
ability of operators of development properties to finance project
construction to completion and bring projects into production as
expected; operators’ delays in securing or inability to secure necessary
governmental permits; decisions and activities of the operators of the
Company's stream and royalty properties; unanticipated grade,
environmental, geological, seismic, metallurgical, processing, liquidity
or other problems the operators of the mining properties may encounter;
changes in operators’ project parameters as plans continue to be
refined; changes in estimates of reserves and mineralization by the
operators of the Company’s stream and royalty properties; contests to
the Company’s stream and royalty interests and title and other defects
to the Company’s stream and royalty properties; errors or disputes in
calculating stream deliveries and royalty payments, or deliveries or
payments not made in accordance with stream and royalty agreements;
economic and market conditions; risks associated with conducting
business in foreign countries; changes in laws governing the Company and
its stream and royalty properties or the operators of such properties,
and other subsequent events; as well as other factors described in the
Company's Annual Report on Form 10-K, Quarterly Reports on Form 10-Q,
and other filings with the Securities and Exchange Commission. Most of
these factors are beyond the Company’s ability to predict or control.
The Company disclaims any obligation to update any forward-looking
statement made herein. Readers are cautioned not to put undue reliance
on forward-looking statements.

Statement Regarding Third Party Information: Certain information
provided in this press release, including production estimates for
calendar 2017, has been provided to us by the operators of the relevant
properties or is publicly available information filed by these operators
with applicable securities regulatory bodies, including the Securities
and Exchange Commission. Royal Gold has not verified, and is not in a
position to verify, and expressly disclaims any responsibility for, the
accuracy, completeness or fairness of such third-party information and
refers the reader to the public reports filed by the operators for
information regarding those properties.

TABLE 1

Third Quarter Fiscal 2017

Revenue and Reported Production for Principal Stream and Royalty
Interests

(In thousands, except reported production in oz. and lbs.)

Three Months Ended

Three Months Ended

March 31, 2017

March 31, 2016

Reported

Reported

Stream/Royalty

Metal(s)

Revenue

Production1

Revenue

Production1

Stream:

Mount Milligan

Gold

$

35,112

28,900

oz.

$

29,806

25,400

oz.

Pueblo Viejo2

$

24,524

$

13,608

Gold

15,600

oz.

11,800

oz.

Silver

322,000

oz.

N/A

Andacollo

Gold

$

10,398

8,500

oz.

$

15,730

13,500

oz.

Wassa and Prestea

Gold

$

6,563

5,400

oz.

$

4,155

3,500

oz.

Other3

Gold

$

-

N/A

$

140

100

oz.

Total stream revenue

$

76,597

$

63,439

Royalty:

Peñasquito

$

6,981

$

5,210

Gold

137,500

oz.

120,300

oz.

Silver

4.8

Moz.

4.8

Moz.

Lead

31.3

Mlbs.

30.2

Mlbs.

Zinc

88.5

Mlbs.

73.1

Mlbs.

Cortez

Gold

$

1,068

11,300

oz.

$

1,853

18,400

oz.

Other3

Various

$

22,326

N/A

$

22,985

N/A

Total royalty revenue

$

30,375

$

30,048

Total revenue

$

106,972

$

93,487

Nine Months Ended

Nine Months Ended

March 31, 2017

March 31, 2016

Reported

Reported

Stream/Royalty

Metal(s)

Revenue

Production1

Revenue

Production1

Stream:

Mount Milligan

Gold

$

105,161

83,500

oz.

$

95,564

85,100

oz.

Pueblo Viejo4

$

71,911

$

23,008

Gold

40,200

oz.

20,600

oz.

Silver

1.2

Moz.

N/A

Andacollo

Gold

$

41,552

32,900

oz.

$

32,163

28,200

oz.

Wassa and Prestea

Gold

$

17,484

14,000

oz.

$

17,555

15,500

oz.

Other

Gold

$

-

N/A

$

317

200

oz.

Total stream revenue

$

236,108

$

168,607

Royalty:

Peñasquito

$

19,935

$

20,208

Gold

423,000

oz.

542,100

oz.

Silver

15.1

Moz.

18.8

Moz.

Lead

97.8

Mlbs.

120.9

Mlbs.

Zinc

232.1

Mlbs.

289.8

Mlbs.

Cortez

Gold

$

4,942

47,600

oz.

$

4,840

58,000

oz.

Other3

Various

$

70,895

N/A

$

72,005

N/A

Total royalty revenue

$

95,772

$

97,053

Total revenue

$

331,880

$

265,660

TABLE 2

Historical Production

Reported Production For The Quarter Ended1

Property

Stream/Royalty

Operator

Metal(s)

Mar. 31,2017

Dec. 31,2016

Sep. 30,2016

Jun. 30,2016

Mar. 31,2016

Stream:

Mount Milligan5

35.00% of payable gold; 18.75% of payable copper

Centerra

Gold

28,900

oz.

25,700

oz.

28,900

oz.

23,800

oz.

25,400

oz.

Pueblo Viejo

7.5% of gold produced up to 990,000 ounces; 3.75% thereafter

Barrick (60%)

Gold

15,600

oz.

13,700

oz.

11,000

oz.

10,600

oz.

11,800

oz.

75% of payable silver up to 50 million ounces; 37.5% thereafter

Silver

322,000

oz.

543,300

oz.

323,300

oz.

208,900

oz.

N/A

Andacollo

100% of gold produced

Teck

Gold

8,500

oz.

9,200

oz.

15,200

oz.

13,500

oz.

13,500

oz.

Wassa and Prestea

9.25% of gold produced up to 240,000 ounces; 5.5% thereafter

Golden Star

Gold

5,400

oz.

4,000

oz.

4,500

oz.

4,600

oz.

3,500

oz.

Royalty:

Peñasquito

2.0% NSR

Goldcorp

Gold

137,500

oz.

185,400

oz.

100,100

oz.

41,900

oz.

120,300

oz.

Silver

4.8

Moz.

5.0

Moz.

5.2

Moz.

2.6

Moz.

4.8

Moz.

Lead

31.3

Mlbs.

33.6

Mlbs.

33.0

Mlbs.

13.3

Mlbs.

30.2

Mlbs.

Zinc

88.5

Mlbs.

70.5

Mlbs.

73.0

Mlbs.

43.2

Mlbs.

73.1

Mlbs.

Cortez

GSR1 and GSR2, GSR3, NVR1

Barrick

Gold

11,300

oz.

14,500

oz.

21,800

oz.

16,100

oz.

18,400

oz.

FOOTNOTESTables 1 and 2

1

Reported production relates to the amount of metal sales that are
subject to our stream and royalty interests for the stated period,
as reported to us by operators of the mines.

2

The first silver stream deliveries were in March 2016, with the
first silver sales made during the June 2016 quarter.

3

Individually, no stream or royalty included within the “Other”
category contributed greater than 5% of our total revenue for the
entire period.

4

The gold and silver streams at Pueblo Viejo were acquired during the
three months ended September 30, 2015. The first gold and silver
stream deliveries were in December 2015 and March 2016, respectively.

5

Reflects the October 20, 2016 amendment to our Mount Milligan
streaming agreement. Prior to the amendment, Royal Gold held a
52.25% gold stream. Gold concentrate that was in transit at October
20, 2016 was delivered to us under the 52.25% gold stream. Royal
Gold began receiving gold and copper deliveries reflecting the
amended stream agreement in April 2017.

TABLE 3

Calendar 2017 Operator’s Production Estimate vs Actual Production

Calendar 2017 Operator's Production

Calendar 2017 Operator's Production

Estimate1

Actual2,3

Gold

Silver

Base Metals

Gold

Silver

Base Metals

Stream/Royalty

(oz.)

(oz.)

(lbs.)

(oz.)

(oz.)

(lbs.)

Stream:

Andacollo4

61,600

-

-

14,600

-

-

Mount Milligan5

260,000-290,000

-

-

45,200

-

-

Copper

55 - 65 million

12.6 million

Pueblo Viejo6

625,000-650,000

Not provided

143,000

Not provided

-

Wassa and Prestea7

255,000-280,000

57,800

Royalty:

Cortez GSR1

102,200

-

-

11,200

-

-

Cortez GSR2

1,600

-

-

100

-

-

Cortez GSR3

103,800

-

-

11,300

-

-

Cortez NVR1

63,900

-

-

4,700

-

-

Peñasquito8

410,000

Not provided

-

137,000

4.8 million

-

Lead

Not provided

32.4 million

Zinc

Not provided

80.7 million

1

Production estimates received from our operators are for calendar
2017. There can be no assurance that production estimates received
from our operators will be achieved. Please refer to our cautionary
language regarding forward-looking statements and the statement
regarding third party information contained in this press release,
as well as the Risk Factors identified in Part I, Item 1A, of our
Fiscal 2016 Form 10-K for information regarding factors that could
affect actual results.

2

Actual production figures shown are from our operators and cover the
period January 1, 2017 through March 31, 2017.

3

Actual production figures for Cortez are based on information
provided to us by Barrick Gold Corporation, and actual production
figures for Andacollo, Mount Milligan, Pueblo Viejo, Peñasquito
(gold) and Wassa and Prestea are the publicly reported figures of
the operators of those properties.

4

The estimated and actual production figures shown for Andacollo are
contained gold in concentrate.

5

The estimated and actual production figures shown for Mount Milligan
are payable gold and copper in concentrate.

6

The estimated and actual production figures shown for Pueblo Viejo
are payable gold in doré and represent Barrick’s 60% interest in
Pueblo Viejo.

7

The estimated gold production figures shown for Wassa and Prestea
are payable gold in concentrate and doré.

8

The estimated and actual gold production figures shown for
Peñasquito are payable gold in concentrate. The operator did not
provide estimated silver, lead and zinc production.

Net income (loss) per share available to Royal Gold common
stockholders:

Basic earnings (loss) per share

$

0.36

$

(1.04

)

$

1.25

$

(1.50

)

Basic weighted average shares outstanding

65,169,883

65,085,225

65,145,183

65,069,056

Diluted earnings (loss) per share

$

0.36

$

(1.04

)

$

1.25

$

(1.50

)

Diluted weighted average shares outstanding

65,274,926

65,085,225

65,267,201

65,069,056

Cash dividends declared per common share

$

0.24

$

0.23

$

0.71

$

0.68

ROYAL GOLD, INC.

Consolidated Statements of Cash Flows

(Unaudited, in thousands)

For The Three Months Ended

For The Nine Months Ended

March 31,

March 31,

March 31,

March 31,

2017

2016

2017

2016

Cash flows from operating activities:

Net income (loss)

$

21,531

$

(69,498

)

$

75,588

$

(100,521

)

Adjustments to reconcile net income (loss) to net cash provided by
operating activities:

Depreciation, depletion and amortization

40,164

38,163

119,785

105,717

Amortization of debt discount and issuance costs

3,451

3,247

10,202

9,687

Non-cash employee stock compensation expense

314

2,340

6,758

7,789

Impairments of stream and royalty interests and royalty receivables

-

98,973

-

98,588

Tax expense (benefit) of stock-based compensation exercises

39

-

(38

)

247

Deferred tax (benefit) expense

(3,055

)

(5,479

)

(6,266

)

(17,246

)

Other

-

(675

)

(4,638

)

(1,065

)

Changes in assets and liabilities:

Royalty receivables

698

(176

)

(4,801

)

14,976

Stream inventory

3,554

2,887

2,865

(3,115

)

Income taxes receivable

5,633

(6,526

)

(6,539

)

(2,996

)

Prepaid expenses and other assets

92

(1,958

)

(743

)

85

Accounts payable

191

559

(1,641

)

(1,533

)

Uncertain tax positions

1,289

1,144

7,341

1,950

Other liabilities

2,198

3,050

3,021

8,084

Net cash provided by operating activities

$

76,099

$

66,051

$

200,894

$

120,647

Cash flows from investing activities:

Acquisition of stream and royalty interests

(10,903

)

(1,272

)

(203,721

)

(1,326,256

)

Andacollo royalty termination

-

-

-

345,000

Golden Star term loan

-

-

-

(20,000

)

Proceeds from sale of available-for-sale securities

-

6,933

-

6,933

Other

(271

)

(31

)

1,503

(302

)

Net cash (used in) provided by investing activities

$

(11,174

)

$

5,630

$

(202,218

)

$

(994,625

)

Cash flows from financing activities:

Borrowings from revolving credit facility

-

-

70,000

350,000

Repayment of revolving credit facility

(45,000

)

(50,000

)

(45,000

)

(50,000

)

Net payments from issuance of common stock

(298

)

(174

)

(2,618

)

(174

)

Common stock dividends

(15,680

)

(15,010

)

(45,715

)

(43,709

)

Purchase of additional royalty interest from non-controlling interest

(24

)

-

(1,462

)

-

Tax (benefit) expense of stock-based compensation exercises

(39

)

-

38

(247

)

Other

218

(1,234

)

(2,462

)

(1,878

)

Net cash (used in) provided by financing activities

$

(60,823

)

$

(66,418

)

$

(27,219

)

$

253,992

Net increase (decrease) in cash and equivalents

4,102

5,263

(28,543

)

(619,986

)

Cash and equivalents at beginning of period

83,988

117,600

116,633

742,849

Cash and equivalents at end of period

$

88,090

$

122,863

$

88,090

$

122,863

SCHEDULE A

Non-GAAP Financial Measures

Non-GAAP financial measures are intended to provide additional
information only and do not have any standard meaning prescribed by
generally accepted accounting principles (“GAAP”). These measures should
not be considered in isolation or as a substitute for measures of
performance prepared in accordance with GAAP.

Our management uses Adjusted EBITDA and Adjusted Net Income as measures
of operating performance to assist in comparing performance from period
to period on a consistent basis; as a measure for planning and
forecasting overall expectations and for evaluating actual results
against such expectations; in communications with the board of
directors, stockholders, analysts and investors concerning our financial
performance; as useful comparisons to the performance of our
competitors; and as metrics of certain management incentive compensation
calculations. We believe that these measures are used by and are useful
to investors and other users of our financial statements in evaluating
our operating performance because they provide an additional tool to
evaluate our performance without regard to special and non-core items,
which can vary substantially from company to company depending upon
accounting methods and book value of assets and capital structure. We
have provided reconciliations of all non-GAAP measures to their nearest
U.S. GAAP measures and have consistently applied the adjustments within
our reconciliations in arriving at each non-GAAP measure. We consider
these items to be necessary adjustments for purposes of evaluating our
ongoing business performance and are often considered non-recurring.
Such adjustments are subjective and involve significant management
judgment.

Adjusted EBITDA Reconciliation

Adjusted EBITDA is defined by the Company as net income (loss) plus
depreciation, depletion and amortization, non-cash charges, income tax
expense, interest and other expense, and any impairment of mining
assets, less non-controlling interests in operating loss (income) of
consolidated subsidiaries, interest and other income, and any royalty
portfolio restructuring gains or losses. Other companies may define and
calculate this measure differently. Adjusted EBITDA identifies the cash
generated in a given period that will be available to fund the Company's
future operations, growth opportunities, shareholder dividends and to
service the Company's debt obligations. This information differs from
measures of performance determined in accordance with U.S. GAAP and
should not be considered in isolation or as a substitute for measures of
performance determined in accordance with U.S. GAAP. See the table below
for a reconciliation of net income to Adjusted EBITDA.

Management of the Company uses adjusted net income (loss) to evaluate
the Company’s operating performance, and for planning and forecasting
future business operations. The Company believes the use of adjusted net
income (loss) allows investors and analysts to understand the results
relating to receipt of revenue from its royalty interests and purchase
and sale of gold from its streaming interests by excluding certain items
that have a disproportionate impact on our results for a particular
period. The net income (loss) adjustments are presented net of tax
generally at the Company’s statutory effective tax rate. Management’s
determination of the components of adjusted net income (loss) are
evaluated periodically and based, in part, on a review of non-GAAP
financial measures used by mining industry analysts. Net income (loss)
attributable to Royal Gold stockholders is reconciled to adjusted net
income (loss) as follows:

For The Three Months Ended

For The Nine Months Ended

March 31,

March 31,

(Unaudited, in thousands)

(Unaudited, in thousands)

2017

2016

2017

2016

Net income (loss) attributable to Royal Gold common stockholders

$

23,661

$

(67,656

)

$

81,509

$

(97,589

)

Impairments of stream and royalty interests and royalty receivables,
net of tax